Higher Taxes and cost for food set to rise on the Bahamian people as FNM Govt approves hike on shippers

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Arawak Cay

New fee increases at apd affecting shipping charges

Published On:Monday, February 13, 2012

By NATARIO McKENZIE Tribune Business Reporter

nmckenzie@tribunemedia.net

FEE increases at the new Arawak Port Development (APD) affecting shipping companies may soon affect retailers and wholesalers, with one shipping company already announcing new charges due to increased operating costs associated with the port’s new tariff structure.

Crowley has announced that due to increased operating costs associated with the March 1 tariff implementation, the company would apply a new charge to open tariff and contract shipments for both northbound and southbound cargo. Crowley has announced that its Nassau port charges for its 20-foot equipment will be $150 per unit, $300 per unit 40 ft equipment and $350 for its 45-foot equipment. The company noted that the second upcoming phase of the port tariff would be implemented on April 1 and that it was evaluating the impact of that increase to the trade and would be reporting to its customers in the very near future regarding the financial impact. The company said:

“Crowley has been impacted by the challenging market conditions and increased operating costs over the past several months and is forced to pass along the increased costs associated with handling cargo at the new terminal at Arawak Cay.”

Retailers and wholesalers told Tribune Business that any added financial burden on them would ultimately be passed on to consumers in the not too distant future. One prominent retailer expressing his concerns to Tribune Business under anonymity explained: “My bill is broken into two charges, US charges and Bahamian charges. The Bahamianb charges are basically your landing fees and any security fees. If I’m bringing a 40 ft container in for instance I’m paying almost $900 in landing charges. Now they’re going to take that $900 to $1,200. That’s a 33 per cent increase. That means I’m going to raise my prices to the general public because I cannot afford to eat a 33 per cent increase.

“All of these fees will be passed off to the consumer,” he said. The retailer added: “Twenty-foot containers are going up $150, the 40 ft containers are going up $300. I eat increases all the time in small areas like bunker fees that go $50 or $60. We can’t afford to eat those kind of prices. I’m a big business and there are some that are much bigger than me. How can they justify these prices for putting a container on a dock, it’s outrageous you are going to see increases across this entire island. That money goes directly to the port, that doesn’t go in the shipping companies pockets. We are going to have to probably lobby the shipping companies to lower their rates which they won’t do because they are already at rock bottom prices. I would not be surprised if one or two shipping companies seriously considered pulling out of this market.”

Phil Lightbourne, CEO of Phil’s Food Services, Gladstone Road told Tribune Business: “I’ve heard that some are going up $300 per container in March and some are going up $300 in April but I haven’t gotten any official confirmation as yet.” As to how this would affect consumers he said: “You have to put it into the grocery, it’s something you can’t do anything with.” One leading wholesaler told Tribune Business: “Information we get on the fees as I know are still as far as I know up for changing it seems as though every couple of weeks. I’m not positive if those fees are going to be exactly as they are or not. I feel pretty sure there will be an increase in fees. Yes it will impact business just as any freight rate increase would. Eventually all these increased costs will have to be passed on to the consumer one way or the other.”

Attempts to reach APD CEO Mike Maura Jr proved unsuccessful, however, under a tariff information posting on the company’s website, wharfage/landing fees or cargo rates for a 20-foot container was $120, for a 40-foot container $240, for a 45-foot container $270 and $318 for a 53-foot container.